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View Full Version : Poll How many of You Own Life Insurance?


Leec
10-28-2004, 10:42 AM
How Many Own a Permanent Life Policy(UL or WL)?
How Many Rent Their Life Insurance(Term)?
How many do not have any Life Insurance? Why?

NeilM
10-28-2004, 10:53 AM
' got both WL & Term... Term covers the mortgage, WL to cover funeral costs, etc.


Man, we cover EVERYTHING here :dance: .. Relationships, beer, cars, music, TV, movies, politics, religion, weather, photos, football, baseball, computers, and oh yes.. sometimes even BOATS! :toast:

' gonna be a long winter.... glad to have my friends at TeamTalk...

Leec
10-28-2004, 11:22 AM
Yes Neil we cover everything!:smile: LOL I just got curious about who owned Life Insurance and if someone doesn't and is insurable maybe this could trigger them to go apply for it. I think it is so sad when a head of a family dies prematurely and did not provide for his wife and kids. Not judging here jusy curious. That is why I have the "why not" if they don't own any. I want them to have to try and answer that question. :noface:
So thanks for answering my poll Neil.
:smile:

BriEOD
10-28-2004, 11:34 AM
' got both WL & Term... Term covers the mortgage, WL to cover funeral costs, etc.


Man, we cover EVERYTHING here :dance: .. Relationships, beer, cars, music, TV, movies, politics, religion, weather, photos, football, baseball, computers, and oh yes.. sometimes even BOATS! :toast:

' gonna be a long winter.... glad to have my friends at TeamTalk...

Ditto here for the wife & I.

sfitzgerald351
10-28-2004, 11:56 AM
No life insurance here... Not married quite yet (Spring 05), house mortgage is paid by renters (2-family) and only other debt is school loans. Fiance makes decent living so I don't see a real need. Pretty amazing considering my dad is an insurance broker and I have just about every other aspect of my life insured to the max.

sizzler
10-28-2004, 12:06 PM
hows this for hipocrasy.........should i die, she gets 4x my salary from the co.,,,she gets my pension schemes,,she gets numerous life ins. policies,,,endowment schemes,,,she gets the house ,which when i die the mortgage gets paid off,the house is worth in xs of 1m,she gets the boat and the holiday home(caravan)........however if she dies,its a different kettle of fish.......i have to give up work to look after the kids,wont be able to pay the mortgage,so i sell the house,,,,,,,,i put this to her ,as i wanted to take life.ins. out on her,so me and the kids would be catered for in the event of a tragic accident...she thinks i want to do it so i can bump her off,and she is having ntg of it...


we can't win

east tx skier
10-28-2004, 12:07 PM
Good old State government. I'm covered. Hope it stays that way. Did you know that more of the Texas state budget is allocated to painting the white lines on the highway than is allocated to the entire state judiciary. Somethingly like 0.1%.

NeilM
10-28-2004, 12:16 PM
... Did you know that more of the Texas state budget is allocated to painting the white lines on the highway than is allocated to the entire state judiciary. Somethingly like 0.1%.
Yeah, but Doug, it's a BigA$$ state... miles of white lines :rolleyes:

OhioProstar
10-28-2004, 01:04 PM
I own WL as an investment vehicle and TL through work since it is so cheap.

Leroy
10-28-2004, 01:45 PM
I voted no, but actually my work has a decent policy on me, if I die on the job.

lakes Rick
10-28-2004, 01:47 PM
Please give my number to your wives if any of you die... I would like to be on easy street..

Leroy
10-28-2004, 01:48 PM
I would sleep with one eye open Sizzler!

east tx skier
10-28-2004, 02:11 PM
Yeah, but Doug, it's a BigA$$ state... miles of white lines :rolleyes:

Leroy, I had to read that one a couple of times. Kept thinking it said miles of white lies. ;)

Lance
10-28-2004, 02:39 PM
Interesting thread... It just so happens I just completed the process of getting both whole and term life insurance in the last 2 months. My wife works so didn't do anything when we were without kids reasoning that she could still get along fine. Wouldn't you know it I had a relatively minor (but expensive from life insurance perspective) medical issue right when we were having our first child. This issue is going to cost me a lot over the next 20 years. Nothing I can do though since I want to make sure kids are taken care of in the event of...

The one advice I would have is for those that don't have any real need for insurance yet (young and either single or married w/o kids) to still consider it. God forbid if something happens to you (like my 31 year old friend that just had open heart surgery to replace valves due to a weird bacterial infection) before you need insurance you won't be able to get it when you do need it. Getting insurance gets both insurance and insurability. When I was young and invinceable I ignored this advice from several people but now which I hadn't. I expect most will do the same here but I would guess at least one person will regret it in the future as well.

Lance

Mag_Red
10-28-2004, 07:34 PM
Having been in "the business" there is no way I would ever buy whole life. That being said.......I have enough in investments, tax shelters, etc to cover my daughters educational expenses throug college should something happen before then. All my liabilities will be paid.....no reason to leave a windfall for the ex-wife to squander. :twocents:

lakes Rick
10-28-2004, 08:25 PM
Having been in "the business" there is no way I would ever buy whole life. That being said.......I have enough in investments, tax shelters, etc to cover my daughters educational expenses throug college should something happen before then. All my liabilities will be paid.....no reason to leave a windfall for the ex-wife to squander. :twocents:

What mag said...

Leec
10-29-2004, 12:07 PM
Good old State government. I'm covered. Hope it stays that way. Did you know that more of the Texas state budget is allocated to painting the white lines on the highway than is allocated to the entire state judiciary. Somethingly like 0.1%.
Doug check, usually they day you leave,fired or quit your group life insurance is cancelled! Not the same as health insurance.
:smile:

Leec
10-29-2004, 12:14 PM
hows this for hipocrasy.........should i die, she gets 4x my salary from the co.,,,she gets my pension schemes,,she gets numerous life ins. policies,,,endowment schemes,,,she gets the house ,which when i die the mortgage gets paid off,the house is worth in xs of 1m,she gets the boat and the holiday home(caravan)........however if she dies,its a different kettle of fish.......i have to give up work to look after the kids,wont be able to pay the mortgage,so i sell the house,,,,,,,,i put this to her ,as i wanted to take life.ins. out on her,so me and the kids would be catered for in the event of a tragic accident...she thinks i want to do it so i can bump her off,and she is having ntg of it...
Well all I can say is that is the main reason you should have life insurance on your wife! All Insurance planners would tell you and I have personally seen it happen where a man who owned his own business lost his wife and he had to pay over $2,000 a month for someone to come in and do all his wife did, but screw him. That is cook clean run kids everywhere they needed to be,Ie: school,soccor,basketball,baseball,friends houses, doctors appointments..........
:smile:

jake
10-29-2004, 12:21 PM
Mag: I'm with you, I was in the business previously as well (stock broker/financial planner) I would never buy cash value/permanent life insurance. Buy term-invest the rest, you'll come out miles and miles ahead.

No offense Lee, I know you just became a life insurance rep, but the numbers just don't add up. You know there's a reason the commissions on perm life (whole/UL/Variable) are so high! The insurance companies make a killing on it.

Leec
10-29-2004, 12:21 PM
I voted no, but actually my work has a decent policy on me, if I die on the job.
Key words "if you die on the job?" Leroy as with Doug you really have no Life Insurance should you get fired, laid off, or quit. Your Life Insurance stops protecting you when you no longer work for that company. There is no COBRA or one week extension ect. Also if your health has changed then you may not be able to buy Life Insurance at any price or maybe it will be severly rated. But the real losers are anyone who is dependent on you for support,kids, wife?
:smile:

Leec
10-29-2004, 12:24 PM
I own WL as an investment vehicle and TL through work since it is so cheap.
I would not count on the TERM at work to protect you. It is only in force as long as you work there. No companies today allow you to own the term thru work. When you leave the company for what ever reason then you lose your term life coverage.
:smile:

Leec
10-29-2004, 12:44 PM
Mag: I'm with you, I was in the business previously as well (stock broker/financial planner) I would never buy cash value/permanent life insurance. Buy term-invest the rest, you'll come out miles and miles ahead.

No offense Lee, I know you just became a life insurance rep, but the numbers just don't add up. You know there's a reason the commissions on perm life (whole/UL/Variable) are so high! The insurance companies make a killing on it.

None taken Jake,but you are ignoring your own advice! "Buy term and invest the difference" that is what Adjustable/ Universal Life does. There is an Investment account and an Insurance mortality account. You have a rate of return that is guaranteed 4% less the 1980 CSO mortality expenses(term Insurance) taken each year. Then you have the current rate 5% less the actual experiences of that Insurance company. Plus you have the ability to have the Insurance in force when you die when ever that is VS a 10 or 20 year period when the term runs out. Also you have the TAX deferral of the earnings and under current law may never be taxable to you.
The worst thing that could happen is you no longer need the insurance and you get all your money back plus some in the UL VS the $20,000 or so you spent on the term. Term is a good thing for a specific need, like 20 years to be sure if you die with in the next 20 years,that your children are funded to go to college. Then you no longer have that need. You will always have a need for a certain amount as long as you have anyone who is dependent on you (WIFE)!
You can even use your permanent life insurance to fund Pension Maximization . Do you know what that is?
:smile:

Leroy
10-29-2004, 02:53 PM
Leroy, I had to read that one a couple of times. Kept thinking it said miles of white lies. ;)
I think you meant Neil! But I like the Freudian slip.....

Jorski
11-04-2004, 01:50 PM
**"Buy term and invest the difference" that is what Adjustable/ Universal Life does**

With all due respect...the UL programs invest the difference in the most expensive fashion imaginable. The costs are simply too high. You would be much better off directing the investment portion into an index. You get tax deferral as long as you own it AND you keep control of your money.

The two biggest drivers of investment return are the price you pay for your investment (price versus intrinsic value) and investment expense. I could go on for ever about the high cost of investing inside of Insurance vehicles, but I won't.

PS the evidence is largely similar when looking at mutual funds. Studies by Fama and French definitively show that you best served by small cap/ deep value stocks.

This article by John Bogle the founder of Vanguard funds says it all:
http://www.vanguard.com/bogle_site/sp20021014.html

Hints: Read Fama and French, Peter Bernstein, Rob Arnotte, Bill Gross and everything written by or about Warren Buffet

Background: MBA, CFA and 15 years of managing money for the high net worth crowd. Had an insurance license and gave it up; could find nothing that represented value for my clients. What I could find was a number of ways to generate large commissions.
Own lots of TERM TO 100. Insurance is to secure my families lifestyle should should I bite it, nothing more.

jake
11-05-2004, 10:58 AM
[QUOTE=Leec][/color][/size]

None taken Jake,but you are ignoring your own advice! "Buy term and invest the difference" that is what Adjustable/ Universal Life does. There is an Investment account and an Insurance mortality account. You have a rate of return that is guaranteed 4% less the 1980 CSO mortality expenses(term Insurance) taken each year. Then you have the current rate 5% less the actual experiences of that Insurance company. Plus you have the ability to have the Insurance in force when you die when ever that is VS a 10 or 20 year period when the term runs out. Also you have the TAX deferral of the earnings and under current law may never be taxable to you....
QUOTE]

Lee: spoken like a life insurance salesman. The costs of investment in insurance products is just too high, and you have to keep the policy in force forever to maintain that tax advantage you talk about. So, I have to keep paying the cost of insurance when I'm 85, even if I don't have an insurance need, just so I don't owe a pile of ordinary income taxes on my realized gain when the policy lapses? No way.

BTW, this is what lead to the nasty round of class action lawsuits in the late 90's against all the major insurance companies who sold UL's as great investment vehicles in the 80's with unrealistic projected interest rates, right up to the point where the illustrated rates of return didn't pan out and people's policies started to lapse.....oops, maybe these aren't as good of an investment vehicle as we thought, here's $300 million, now we'll keep selling them and call them VUL's and illustrate them based on 10-12% annual market returns...can't wait till the VUL lawsuits start.

Not to mention that the word "invest" is a stretch for what happens to your money in a life product (life insurance or annuities). You take an investment vehicle that is already too expensive (ie a mutual fund or similar) then you call it a separate account and stack on an additional 1-1.5% for the insurance companies cut. It's a racket!

Buy term, invest in long term, tax smart investments, i.e. buy and hold individual equity and debt instruments based on yoru risk profile.

Dallas2254
11-16-2004, 05:16 PM
I used to think that using my insurance as an investment in the long run made good sense. Because it certainly made great sense if I didn't make it through the long run. I have been in the insurance and investment management business for 23 years. Most of what experience has taught me was that you buy life insurance for what it is designed for, creating a lot of money when you need it the most. Insurance will never make you rich while you are alive unless you are committing fraud.

I have bought enough (term insurance) to make sure that they won't miss me for very long and I consider my fianancial plan secure enough that I won't fail in making sure that I won't need it 20 years after I bought it.

Outside of needing life insurance for paying estate taxes, buy sell arrangments with business partners, pension maximizing, or getting a divorce and starting over, if someone really needs their insurance beyond a reasonable number of working years, they must have failed at saving a good portion of their income toward retirement plans (preferrably ones that are tax deferred going into). Yes, Life insurance is a forced saving plan but really only good for those who like to be insurance poor and don't know how to operate a $100 bill.

My advice, buy term, invest the difference in 401k's and if you have left over savings go for a good long term capital gain asset that cost you much lower taxes than life insurance and retirement plans when you sell them, assuming you are still in a good tax bracket. I like my SBUX stock. I own a few houses and it is nice to hold on to something that is tangible and not subjected to emotions like the stock market and cash value that is invested in such. Mastercraft boat excluded. The expense fees in variable life and tax consequenses of cashing them out in later years (if not borrowing all the money out and letting them implode) are not desirable.

Damn, I could have gotten in a couple runs in the dry suit in the time it took to write this.

Dallas in Seattle

CLU ChFC CFP

jimmer2880
11-17-2004, 05:59 AM
I used to think that using my insurance as an investment in the long run made good sense. Because it certainly made great sense if I didn't make it through the long run. I have been in the insurance and investment management business for 23 years. Most of what experience has taught me was that you buy life insurance for what it is designed for, creating a lot of money when you need it the most. Insurance will never make you rich while you are alive unless you are committing fraud.

I have bought enough (term insurance) to make sure that they won't miss me for very long and I consider my fianancial plan secure enough that I won't fail in making sure that I won't need it 20 years after I bought it.

Outside of needing life insurance for paying estate taxes, buy sell arrangments with business partners, pension maximizing, or getting a divorce and starting over, if someone really needs their insurance beyond a reasonable number of working years, they must have failed at saving a good portion of their income toward retirement plans (preferrably ones that are tax deferred going into). Yes, Life insurance is a forced saving plan but really only good for those who like to be insurance poor and don't know how to operate a $100 bill.

My advice, buy term, invest the difference in 401k's and if you have left over savings go for a good long term capital gain asset that cost you much lower taxes than life insurance and retirement plans when you sell them, assuming you are still in a good tax bracket. I like my SBUX stock. I own a few houses and it is nice to hold on to something that is tangible and not subjected to emotions like the stock market and cash value that is invested in such. Mastercraft boat excluded. The expense fees in variable life and tax consequenses of cashing them out in later years (if not borrowing all the money out and letting them implode) are not desirable.

Damn, I could have gotten in a couple runs in the dry suit in the time it took to write this.

Dallas in Seattle

CLU ChFC CFP
I have 1 question for my financially challenged brain (ain't got none of them economic courses where I went to school beyond how to count change)....

what is CLU ChFC CFP?

jake
11-18-2004, 09:37 AM
I have 1 question for my financially challenged brain (ain't got none of them economic courses where I went to school beyond how to count change)....

what is CLU ChFC CFP?

Industry designations/certifications: It's a way of calling out financial professionals who have added education and experience in varying degrees.
CLU = Certified Life Underwriter
ChFC = Chartered Financial Consultant
CFP = Certified Financial Planner

jimmer2880
11-18-2004, 12:41 PM
ok - thx... I figured they were certs, but had no idea what they meant.